1. What Are New Company Loans?
New company loans are financial products tailored for startups and recently formed businesses. These loans help fund operations, development, marketing, and other initial costs before a company has strong revenue or a credit history.
2. Why Consider a Loan for Your New Company?
- Quick access to startup capital
- No need to give up equity
- Helps build your business credit profile
- Supports cash flow, inventory, and marketing
- Often includes business advice and support (especially government-backed loans)
3. Types of New Company Loans
- Startup Loans: Specifically for businesses trading under 3 years
- Unsecured Loans: No assets needed; based on business plan and personal credit
- Secured Loans: Requires collateral; lower rates but higher risk
- Short-Term Loans: Repayable within 12–24 months
- Merchant Cash Advance: Ideal for retail; repaid from card sales
- Peer-to-Peer (P2P) Lending: Borrow from individual investors through online platforms
4. Top New Company Loan Providers in the UK
- Start Up Loans (British Business Bank)
- Up to £25,000 per applicant, fixed 6% APR
- Repay over 1–5 years
- Includes free business mentoring
- Funding Circle
- Loans for new and growing SMEs
- Requires clear business plan and owner credit check
- iwoca
- Short-term flexible loans starting from £1,000
- Easy online application for early-stage businesses
- Barclays and Lloyds
- Business loans with dedicated support for new ventures
- May require business account and plan
5. Eligibility Criteria
To qualify for new company loans, you usually need:
- A UK-registered business
- Age 18 or over
- A trading history of less than 36 months
- A solid business plan and forecast
- Proof of ID and UK address
- Personal and/or business credit review
6. What Can the Loan Be Used For?
- Business setup and registration
- Product development or stock purchase
- Hiring and staff training
- Equipment and software
- Marketing campaigns and branding
- Premises rental or renovation
7. Application Process
- Choose a lender based on your needs
- Submit an application form (online or in person)
- Attach:
- Business plan and cash flow forecast
- Personal ID and address proof
- Business registration documents
- Bank statements (if trading)
- Review and sign offer
- Receive funds, usually within 1–2 weeks
8. Tips for Approval
- Have a clear, compelling business plan
- Keep loan request realistic and aligned with needs
- Improve your personal credit score
- Show commitment (personal investment helps)
- Seek feedback from business mentors or advisors
Frequently Asked Questions
Can I get a loan with no trading history?
Yes, many startup lenders support pre-revenue businesses.
Are new company loans secured or unsecured?
Both options exist—Start Up Loans are unsecured.
Do I need to be a UK citizen?
You must be a UK resident with legal right to run a business.
How soon can I apply after registering my company?
Immediately—some lenders even accept applications during setup.
Can I repay early?
Yes, many lenders allow early repayment with no penalty.
Are there government-backed options?
Yes, the Start Up Loans scheme is the most popular option.
Conclusion
New company loans in 2024 are a practical way to fund your startup without sacrificing equity. With government support and flexible private lending, you can find the right financial backing to turn your business idea into a thriving reality.